ROBERT E. BRENNAN SUPERSEDING INDICTMENT;
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
UNITED STATES OF AMERICA : Hon. Garrett E. Brown, Jr.
v. : Cr. No. 00-490
ROBERT E. BRENNAN : 18 U.S.C. §§ 152(1), 152(3), 1956(a)(1)(B)(i), and 2
SUPERSEDING INDICTMENT
The Grand Jury in and for the District of New Jersey, sitting in Newark, charges:
COUNT 1
(Concealment of Assets
in Bankruptcy Proceeding)
The Defendant
1. At all times relevant to this Indictment, defendant
ROBERT E. BRENNAN resided in New Jersey and Florida and was primarily engaged in managing his personal business interests. Those interests included, among other things, ownership of all the shares of a securities brokerage firm known as First Jersey Securities, Inc. ("First Jersey").
The SEC Action
2. On or about October 31, 1985, the defendant BRENNAN and First Jersey were sued by the United States Securities and Exchange Commission (the "SEC") in United States District Court for the Southern District of New York in an action entitled SEC v. First Jersey Securities, Inc., et al. (the "SEC action").
3. In or about June 1994, the SEC action went to trial. On or about July 14, 1995, the Court in that action entered judgment against the defendant BRENNAN in favor of the SEC and ordered him personally to pay disgorgement and interest in a total amount of $74,977,992.99.
The Defendant's Accumulation of Gaming Chips
4. From in or about May 1992 to in or about March 1995, the defendant BRENNAN made three trips to the Mirage, a hotel and casino in Las Vegas, Nevada. At the end of each of those trips, BRENNAN departed from the Mirage with a quantity of Mirage gaming chips that he had accumulated, either by purchasing them or by winning them while gambling.
5. As a result, by the time he left the Mirage at the end of the last of the above trips on or about March 13, 1995, BRENNAN had accumulated and had in his personal possession a total of more than $500,000 in Mirage gaming chips.
The Defendant's Collection of Bearer Bonds
6. As of in or about June 1995, the defendant BRENNAN also owned and had in his personal possession a collection of approximately 759 bearer bonds issued by the City and State of New York in the 1960's and 1970's with a face value totaling approximately $3,795,000. Bearer bonds are bonds, typically issued by states and municipalities, that are not registered to a particular owner, but are redeemable by whoever is the bearer of the bonds.
7. In or about June 1995, at Colts Neck, New Jersey, BRENNAN gave the above bearer bonds to a principal of an asset management firm based in the Isle of Man, a self-governing dependency of the British Crown located between Ireland and Great Britain. (That asset management firm principal is hereinafter referred to as the "Isle of Man asset manager.")
8. BRENNAN asked the Isle of Man asset manager to hold the above bearer bonds in safekeeping for him. Shortly afterward, the Isle of Man asset manager personally carried the bonds to his office in the Isle of Man.
The Defendant's Bankruptcy Petition
9. On or about August 7, 1995, the defendant BRENNAN filed a petition for personal bankruptcy in the United States Bankruptcy Court for the District of New Jersey. In the petition, BRENNAN sought protection from the SEC and his other creditors under Chapter 11 of the Bankruptcy Code.
10. BRENNAN also filed certain required schedules together with his bankruptcy petition, including schedules in which he was required to provide a detailed itemization of all his real and personal property of whatever kind as of the date of the petition. The personal property BRENNAN was specifically required to itemize in those schedules included not only his bank accounts, bonds and other securities, and other investments, but also, among other things, the cash he had on hand; his household goods and furnishings; his clothing and jewelry; any collectibles he owned; and any equipment he used in pursuing hobbies.
11. At all times relevant to this Indictment, the administration of bankruptcy cases and estates in the United States Bankruptcy Court for the District of New Jersey was supervised and monitored by a United States Trustee who was an officer of the United States Department of Justice (the "United States Trustee"). The defendant Brennan's bankruptcy petition and the attached schedules were received in the office of the United States Trustee in Newark, New Jersey at or about the time they were filed with the Bankruptcy Court.
The Defendant's Concealment of Assets
12. When he filed his bankruptcy petition on or about August 7, 1995, the defendant BRENNAN remained the owner of the above bearer bonds with a face value of approximately $3,795,000 and the above total of more than $500,000 in casino gaming chips, but deliberately omitted any mention of either the bonds or the chips from the petition and the accompanying schedules. The defendant thereby purposefully concealed those assets from his creditors, the Bankruptcy Court, and the United States Trustee.
13. Further, the defendant BRENNAN continued to conceal the chips and bonds from his creditors, the Bankruptcy Court, and the United States Trustee from on or about August 7, 1995 to the date of this Indictment by, among other things, continuing deliberately to omit any mention of them in testimony he gave and documents he filed in his bankruptcy proceeding; deliberately refraining from otherwise disclosing their existence to any creditor or officer of the Court in that proceeding; and surreptitiously converting them into cash after August 7, 1995, as set forth at paragraphs 2 and 3 of Count 7 and paragraphs 2 through 4 of Count 8 of this Indictment below.
14. Beginning on or about August 7, 1995, and continuing until the date of this Indictment, at Trenton and Newark in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in connection with a case under Title 11, the Bankruptcy Code, knowingly and fraudulently concealed property belonging to the estate of a debtor from creditors, the Bankruptcy Court, and the United States Trustee, in that the defendant concealed more than $500,000 in casino gaming chips and bearer bonds with a face value of approximately $3,795,000 which belonged to his own estate as a debtor as set forth in Paragraphs 11 and 12 above.
In violation of Title 18, United States Code, Sections 152(1) and 2.
COUNT 2
(False Declaration in Bankruptcy Proceeding --
Bankruptcy Petition and Accompanying Schedules)
1. The allegations set forth in paragraphs 1 through 5, 9, and 10 of Count 1 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. The defendant BRENNAN personally signed both his bankruptcy petition and the accompanying schedules and declared under penalty of perjury that, to the best of his knowledge and belief, they were true and correct.
3. However, at no place in his petition or the accompanying schedules did the defendant BRENNAN disclose that, at the time he filed the petition, he owned and possessed more than $500,000 in Mirage gaming chips and the cash value of those chips.
4. On or about August 7, 1995, at Trenton in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the Bankruptcy Court for the District of New Jersey the above bankruptcy petition and accompanying schedules from which he knowingly omitted any mention of his ownership and possession of more than $500,000 in gaming chips and their cash value.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 3
(False Declaration in Bankruptcy Proceeding --
August 24, 1995 Amended Schedules)
1. The allegations set forth in paragraphs 1 through 5, 9, and 10 of Count 1 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. On or about August 24, 1995, October 25, 1995, and December 20, 1995, the defendant BRENNAN filed amended versions of the above schedules accompanying his bankruptcy petition in which he itemized his real and personal property as of the date of that petition. BRENNAN personally signed each set of amended schedules and declared under penalty of perjury that, to the best of his knowledge and belief, they were true and correct.
3. The defendant BRENNAN failed to disclose in the amended schedules he filed on or about August 24, 1995 that, at the time he filed his bankruptcy petition, he owned and possessed more than $500,000 in Mirage gaming chips and the cash value of those chips.
4. On or about August 24, 1995, at Trenton in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the Bankruptcy Court for the District of New Jersey the above amended schedules, from which he knowingly omitted any mention of his ownership and possession of more than $500,000 in gaming chips and their cash value.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 4
(False Declaration in Bankruptcy Proceeding --
October 25, 1995 Amended Schedules)
1. The allegations set forth in paragraphs 1 through 5, 9, and 10 of Count 1 and paragraph 2 of Count 3 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. The defendant BRENNAN failed to disclose in the amended schedules he filed on or about October 25, 1995 that, at the time he filed his bankruptcy petition, he owned and possessed more than $500,000 in Mirage gaming chips and the cash value of those chips.
4. On or about October 25, 1995, at Trenton in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the Bankruptcy Court for the District of New Jersey the above amended schedules, from which he knowingly omitted any mention of his ownership and possession of more than $500,000 in gaming chips and their cash value.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 5
(False Declaration in Bankruptcy Proceeding --
December 20, 1995 Amended Schedules)
1. The allegations set forth in paragraphs 1 through 10 of Count 1 and paragraph 2 of Count 3 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. The defendant BRENNAN failed to disclose in the amended schedules he filed on or about December 20, 1995 that, at the time he filed his bankruptcy petition, he (a) owned and possessed more than $500,000 in Mirage gaming chips and the cash value of those chips, and (b) owned bearer bonds with a face value of approximately $3,795,000 and their cash value.
4. On or about December 20, 1995, at Trenton in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy Code, knowingly and fraudulently made materially false declarations, certificates, and statements under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the Bankruptcy Court for the District of New Jersey the above amended schedules, from which he knowingly omitted any mention of (a) his ownership and possession of more than $500,000 in gaming chips and their cash value and (b) his ownership of bearer bonds with a face value of approximately $3,795,000 and their cash value.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 6
(False Declaration in Bankruptcy
Proceeding -- August 1995 Financial Report)
1. The allegations set forth in paragraphs 1 through 5 and 9 through 11 of Count 1 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. At all times relevant to this Indictment, the United States Trustee required debtors who had filed for bankruptcy under Chapter 11 of the Bankruptcy Code and who had been permitted to remain in possession of their bankruptcy estates to file detailed monthly financial reports with the United States Trustee's office. The defendant BRENNAN was required to file such a report for the period from August 7 through August 31, 1995, and for each month thereafter from September 1995 through June 1997.
3. In each of the above reports, the defendant BRENNAN was required to set forth in detail, among other things, his assets as of the end of the month covered by the report; his cash receipts during the course of that month; and his expenses and cash disbursements during the course of the month.
4. On or about September 7, 1995, the defendant BRENNAN filed with the United States Trustee his monthly financial report for the period from August 7 through August 31, 1995. The defendant personally signed the report and certified under penalty of perjury that, to the best of his knowledge, it was true and correct.
5. However, the defendant BRENNAN failed to disclose in the report that, as of August 31, 1995, his assets included more than $500,000 in Mirage gaming chips and their cash value.
6. On or about September 7, 1995, at Newark in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the United States Trustee the above financial report in which he knowingly failed to list as an asset as of August 31, 1995 more than $500,000 in gaming chips and their cash value.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 7
(False Declaration in Bankruptcy
Proceeding -- September 1995 Financial Report)
1. The allegations set forth in paragraphs 1 through 5 and 9 through 11 of Count 1 and paragraphs 2 and 3 of Count 6 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. From on or about August 31, 1995 to on or about September 4, 1995, the defendant ROBERT E. BRENNAN again visited the Mirage.
3. At or about 2:40 a.m. on September 4, 1995, the defendant BRENNAN presented himself at the cashier's cage in the Mirage casino, gave the cage supervisor $504,794 in Mirage gaming chips, and received $504,794 in cash, mostly $100 bills.
4. On or about October 12, 1995, the defendant BRENNAN filed with the United States Trustee his monthly financial report for the month of September 1995. The defendant personally signed the report and certified under penalty of perjury that, to the best of his knowledge, it was true and correct.
5. However, the defendant BRENNAN failed to disclose in the report that, during the month of September 1995, he had received $504,794 in cash.
6. On or about October 12, 1995, at Newark in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy
Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the United States Trustee the above financial report in which he knowingly failed to disclose his receipt of $504,794 in cash in September 1995.
In violation of Title 18, United States Code, Sections 152(3) and 2.
COUNT 8
(Money Laundering)
1. The allegations set forth in paragraphs 1 through 13 of Count 1 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. In or about October 1995, the defendant BRENNAN instructed the Isle of Man asset manager to sell the bearer bonds BRENNAN had given him in or about June 1995.
3. Pursuant to these instructions from the defendant BRENNAN, between in or about December 1995 and in or about June 1996, the Isle of Man asset manager sold or redeemed all but one of the above bonds and also redeemed numerous past due interest coupons which remained attached to the bonds. He conducted these transactions through a brokerage account he maintained in the name of his asset management firm at Bear, Stearns & Co., Inc. ("Bear, Stearns") in New York City and a bank account he maintained at the Bank of Scotland (Isle of Man), Limited in the name of a nominee corporation (the "Bank of Scotland nominee account").
4. In total, the Isle of Man asset manager realized approximately $4,062,924 from the bonds, all of which he deposited in the Bank of Scotland nominee account to be held for the benefit of the defendant BRENNAN.
5. By giving the above bearer bonds to the Isle of Man asset manager for safekeeping in or about June 1995 as set forth in paragraph 7 of Count 1 of this Indictment, the defendant ROBERT E. BRENNAN engaged in specified unlawful activity in that, in a personal capacity, he knowingly and fraudulently transferred and concealed property he owned in contemplation of a case under Title 11, the Bankruptcy Code, and with intent to defeat the provisions of Title 11, in violation of Title 18, United States Code, Section 152(7).
6. On or about December 19, 1995, Bear, Stearns caused $819,329 in proceeds from the sale of certain of the above bearer bonds to be transferred by wire from New York City to the Bank of Scotland nominee account.
7. From in or about June 1995 to on or about December 19, 1995, at Colts Neck in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN
did knowingly and willfully conduct and cause to be conducted a financial transaction affecting interstate and foreign commerce, that is, the above wire transfer of $819,329 to the Bank of Scotland nominee account, which transaction involved proceeds of the above specified unlawful activity, while knowing that the funds wired in the transaction represented proceeds of unlawful activity and that the transaction was designed in whole and in part to conceal and disguise the nature, location, source, ownership, and control of those proceeds.
In violation of Title 18, United States Code, Sections 1956(a)(1)(B)(i) and 2.
COUNT 9
(Money Laundering)
1. The allegations set forth in paragraphs 1 through 13 of Count 1 and paragraphs 2 through 5 of Count 8 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. On or about February 2, 1996, Bear, Stearns caused $669,594.20 in proceeds from the sale of certain of the above bearer bonds to be transferred by wire from New York City to the Bank of Scotland nominee account.
3. From in or about June 1995 to on or about February 2, 1996, at Colts Neck in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN
did knowingly and willfully conduct and cause to be conducted a financial transaction affecting interstate and foreign commerce, that is, the above wire transfer of $669,594.20 to the Bank of Scotland nominee account, which transaction involved proceeds of the above specified unlawful activity, while knowing that the funds wired in the transaction represented proceeds of unlawful activity and that the transaction was designed in whole and in part to conceal and disguise the nature, location, source, ownership, and control of those proceeds.
In violation of Title 18, United States Code, Sections 1956(a)(1)(B)(i) and 2.
COUNT 10
(Money Laundering)
1. The allegations set forth in paragraphs 1 through 13 of Count 1 and paragraphs 2 through 5 of Count 8 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. On or about March 22, 1996, Bear, Stearns caused $116,349.33 in proceeds from the sale of certain of the above bearer bonds to be transferred by wire from New York City to the Bank of Scotland nominee account.
3. From in or about June 1995 to on or about March 22, 1996, at Colts Neck in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN
did knowingly and willfully conduct and cause to be conducted a financial transaction affecting interstate and foreign commerce, that is, the above wire transfer of $116,349.33 to the Bank of Scotland nominee account, which transaction involved proceeds of the above specified unlawful activity, while knowing that the funds wired in the transaction represented proceeds of unlawful activity and that the transaction was designed in whole and in part to conceal and disguise the nature, location, source, ownership, and control of those proceeds.
In violation of Title 18, United States Code, Sections 1956(a)(1)(B)(i) and 2.
COUNT 11
(False Declaration in Bankruptcy
Proceeding -- July 1996 Financial Report)
1. The allegations set forth in paragraphs 1 through 3 and 6 through 11 of Count 1, paragraphs 2 and 3 of Count 6, and paragraphs 2 through 4 of Count 8 of this Indictment are hereby realleged and incorporated as though set forth in full herein.
2. During the month of July 1996, at the direction of the defendant ROBERT E. BRENNAN, the Isle of Man asset manager wired 310,748 French francs (equivalent to approximately $60,869) from the funds he was holding for BRENNAN in the Bank of Scotland nominee account to a bank in Monaco to pay for BRENNAN's charter of a boat for a Mediterranean cruise.
3. On or about August 18, 1996, the defendant BRENNAN filed with the United States Trustee his monthly financial report for the month of July 1996. The defendant personally signed the report and certified under penalty of perjury that, to the best of his knowledge, it was true and correct.
4. However, the defendant BRENNAN failed to disclose in the report that, during the month of July 1996, he had disbursed approximately $60,869 for a Mediterranean cruise.
5. On or about August 18, 1996, at Newark in the District of New Jersey and elsewhere, the defendant
ROBERT E. BRENNAN,
in and in relation to a case under Title 11, the Bankruptcy
Code, knowingly and fraudulently made a materially false declaration, certificate, and statement under penalty of perjury as permitted under Title 28, United States Code, Section 1746, in that the defendant filed and caused to be filed with the United States Trustee the above financial report in which he knowingly failed to disclose his disbursement of approximately $60,869 for a Mediterranean cruise in July 1996.
In violation of Title 18, United States Code, Sections 152(3) and 2.
A TRUE BILL:
_______________________
FOREPERSON
_________________________
ROBERT J. CLEARY
United States Attorney |
